Government Operations Committee on May 26th, 2015

[Tarik Brahmi, NDP, Saint-Jean, QC]

How many people will work in that institute?

[Diane Finley, Conservative, Haldimand—Norfolk, ON]

They are deciding that as well. They are making decisions as to the how, who, where, how much, and all the rest of it.

[Tarik Brahmi, NDP, Saint-Jean, QC]

Do you have any preliminary reports on the solutions being considered?

[Diane Finley, Conservative, Haldimand—Norfolk, ON]

No. We are waiting for the report and the recommendations, which we are going to examine very carefully.

[Tarik Brahmi, NDP, Saint-Jean, QC]

In other words, no date has been set for the release of a preliminary report. The point is to see whether things need to change within the military procurement process in Canada. I expect that the objective is to improve the process.

[Diane Finley, Conservative, Haldimand—Norfolk, ON]

One of the purposes is to determine who is a part of the industry in Canada. We have no directory listing all of the companies in Canada that provide defence equipment and services throughout the world. It is very important that we list the facilities, products and services available. This will allow us to promote them in our embassies throughout the world, for export purposes particularly, but also with people who might like to build equipment here in Canada and are looking for partners. It is very important to know who these potential partners for foreign businesses are.

[Tarik Brahmi, NDP, Saint-Jean, QC]

I see.

At the same time, in mid-2014, you released the new Defence Acquisition Guide with the minister at the time, Mr. Nicholson.

After almost a year, what conclusions have been drawn as to the effectiveness of the new guide?

Has this underscored some of the weaknesses of the procurement process?

Has there been any feedback concerning the use of the new guide?

[Diane Finley, Conservative, Haldimand—Norfolk, ON]

We are still consulting the members of the industry. For instance, last year I sent an email to over 80 businesses that provide products and services to government. I received opinions from about 400 companies, such as suggestions to improve the procurement process, the consultation process, and all kinds of other things.

We always listen carefully to the industry. For my part, I often attend meetings to hear what the members of the industry have to say. In that way, we have learned many things which we incorporated into the process to improve it. That is why we reversed the process for large procurements of military equipment. In the past, we would ask for proposals and consult the industry. We have reversed this process so that the industry can provide information in the context of the request for proposals. In this way, we have...

[Liseanne Forand, President, Shared Services Canada]

We shortened the process.

[Diane Finley, Conservative, Haldimand—Norfolk, ON]

Yes, we shortened the process. It is now faster and shorter. The information is much better.

[The Chair, NDP, Pat Martin]

I'm afraid I have to stop you there, Minister. Thank you very much.

Thank you, Mr. Brahmi.

We'll return to the Conservatives and Mr. Dan Albas, please, for five minutes.

[Dan Albas, Conservative, Okanagan—Coquihalla, BC]

Thank you, Mr. Chair. It's a pleasure to be here with your committee today.

Minister, I'm very happy that you and the officials are here today.

Minister, sometimes I think that oftentimes parliamentarians relay only complaints to ministers. I think it's appropriate where that happens, but I would like to highlight a few things that are important to my riding of Okanagan—Coquihalla.

A few years back, I had the opportunity to question some of the officials from Shared Services Canada specifically on the accessibility of websites. I had a resident who is blind and had to rely on very cheap software or free software. Some of the changes made when Shared Services Canada made the Government of Canada websites more accessible were really a thrill to him, because he was able to feel that he was part of the country. He's able to ask and seek information about government programs or policies that affect him, and that certainly is an important thing. I wanted to say that it's been important in my riding.

There's some further feedback. Of course, this isn't directed at you, Minister, but he also wishes that the Parliament of Canada's websites were just as accessible. Obviously, Parliament is not a government agency, so it has its own processes for putting those in place, but I would certainly encourage those officials who are in charge of our websites to take a look at what Shared Services Canada has done, because it has won quite good accolades in my riding.

Furthermore, I had the opportunity to talk to someone who worked in Ottawa for a number of years for a subcontractor and did a lot of military work. I had the opportunity to ask him about Shared Services Canada's approach and to ask if he agreed that there would be a fair bit of savings, Minister.

Your presentation today shows first of all that there have been quite a lot of savings right across government. I'm happy to see that Moore's law is being reflected, in that we have new data centres that are able to consolidate into one centre the operations that previously would have had to be done by probably three or four centres. Actually, I think some of the numbers shown here are much higher than that.

He also emphasized to me that the security is much better for the government, because it's far easier to look after a smaller amount of resources than to have hundreds of these centres being watched.

A number of things are here, but in your statement, Minister, you showed that the main estimates represent a total of $1.44 billion and of course a net decrease. Are there specific files that you think the Canadian public would benefit from hearing about? Again, there are big savings and great security for the government. What other elements do you think would be important for my taxpayers to hear about?

[Diane Finley, Conservative, Haldimand—Norfolk, ON]

Well, I think it's important to recognize that we're doing the consolidation through Shared Services Canada for a number of reasons. One is to update and modernize the systems and communications so they're more relevant and more responsive. Two, we want to respect taxpayers' dollars to make sure that we are getting the maximum service for the dollar. Last year alone, Shared Services Canada saved $150 million, so that's significant.

Going forward, the number is about...is it $500 million a year?

[Liseanne Forand]

It's $400 million at the end.

[Diane Finley, Conservative, Haldimand—Norfolk, ON]

It's $400 million a year by the time the transformation is complete.

Another aspect is security. When we had, as we did previously, so many different unconnected systems, the security aspect of monitoring them was really quite a challenge. Through the consolidation that they've already seen, Shared Services Canada has eliminated a number of entry points, which is a good thing, but they've also been able to put in place much better cybersecurity systems and be much more responsive to attacks. As we've seen a couple of times in the last year, they were able to recognize things, get on top of them right away, and then to fix them and take that knowledge that was learned from those experiences and apply it across the government, thereby enhancing security awareness across the board.

There are savings. There are efficiencies and increased security. I think that's a pretty good package. It means that with higher security and more efficient and more responsive systems, we will be able to serve Canadians better, because more and more they are turning to our Internet portals for services, whether it be just to get information, or things like setting up direct deposit accounts, or indeed, transacting business through their personal accounts for themselves or their own businesses.

[The Chair, NDP, Pat Martin]

Unfortunately, Mr. Albas, your time has expired. It went very quickly.

[Dan Albas, Conservative, Okanagan—Coquihalla, BC]

Thank you. I appreciate the interaction.

[The Chair, NDP, Pat Martin]

We will go to the second vice-chair of the committee, Mr. Gerry Byrne, for the Liberal Party.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

Thank you, Chair.

Thank you, Minister, and your officials, for appearing before us.

I want to return to the shipbuilding program. You indicated that the shipbuilding program is going exceptionally well, which is an idea not shared by many outside of the government. It has actually been described by most commentators as being on the rocks.

I want to return to B.C., to the west coast shipbuilding program for the non-combat vessels. Seaspan has been notionally awarded an $8 billion contract, but they have yet to indicate that they have the necessary capacity to fulfill the contract. There is some controversy brewing about how Seaspan can get to that point. They have until June of this year, I understand, to fulfill their requirements under the notional agreement before a formal contract can be awarded.

What are the plans for the Esquimalt graving dock? Are there talks under way whereby Seaspan or some other operator might acquire, through a long-term lease, the rights to operate exclusively or nearly exclusively at the Esquimalt graving dock?

[Diane Finley, Conservative, Haldimand—Norfolk, ON]

These are two totally unrelated questions. I'll deal with the first one first.

We're very confident in the national shipbuilding procurement strategy. We're seeing good success so far. Both Vancouver and Irving in Halifax have invested heavily, not with taxpayers' money, in renovating and building the physical capacity and infrastructure to do the shipbuilding.

In fact, some 300 new jobs have been created in Vancouver at Seaspan. They're expecting 700 more over the next several years of the contract. I was there as we cut steel on a first test block several months ago, and we expect to be cutting steel on the offshore fishery science vessel this summer.

As well, in Halifax already we're seeing tremendous progress. We have every reason to believe they're going to be successful in cutting steel on the AOPS, Arctic offshore patrol ships, by September.

I think it's going really well. Obviously the industry had been allowed to languish for many years. In fact, we had virtually no large shipbuilding industry in this country. You can't go from zero to a hundred right out of the chute. It has taken time to build the proper facilities, for the proponents to develop the in-house expertise that's necessary, to develop the contracts to do all these things, but I'm really confident that we are rebuilding the shipbuilding industry in Canada. It's going to be around for a long time to come. We're building strong companies with strong capabilities.

The naysayers can go on waiting and watching; I think we're going to disappoint them. We will succeed with this and we will create—

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

Minister, rather than waiting and watching, why don't you explain to this committee exactly what Seaspan has to do to fulfill its requirements to be successfully awarded a contract? They have until June to provide evidence that they are capacity ready. What has to be accomplished between now and then, and as part of that process, are they in discussions to take over the Esquimalt graving dock under a lease?

[Diane Finley, Conservative, Haldimand—Norfolk, ON]

As I said, Esquimalt graving dock is a completely separate issue that does not relate to the contract to build the science vessel for the coast guard. That's what we're focused on and that's what they're focused on.

We're working very closely with them. We have people on site to make sure and they have given us every indication that they will meet all the requirements so that we can go ahead and cut steel for that particular vessel.

This is a process. We've come a long way in just a few short years, and I have every confidence that they will succeed.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

Minister, what you're saying is there is nothing really specific that Seaspan has to accomplish, and they should be able to be contract-ready by June 2015.

Will you explain to us exactly what it is they have to do to meet that requirement? What has to be accomplished?

[Diane Finley, Conservative, Haldimand—Norfolk, ON]

There are expectations that have been laid out with them. Obviously, before we sign any contract, we do that with every company with whom we sign contracts. I'm not going to go into the details of a private enterprise contract, but I have every confidence that they will achieve that. They have been bringing in new talent and working hard with the people in the community and with members of my department and the coast guard.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

Just so I'm clear, it's to meet basic bid requirements they tendered for and they were accepted for. You deem that to be a commercial competence. In terms of capacity which was required to be able to participate in this contract—that was an open tendering process, we presume—are you saying now that's a commercial confidentiality?