Good morning, Mr. Chair and distinguished committee members.
My name is Dennis Watters and I am the acting chief financial administration officer for the Royal Canadian Mounted Police.
Thank you for the opportunity to speak with you today about the RCMP's procurement activities, and more specifically the use of national security exceptions as they relate to providing Canada's national police service with the most appropriate and effective equipment to ensure the safety and security of Canadians.
The RCMP's procurement activities are conducted directly in support of the RCMP's operational priorities, including but not limited to the following: enable RCMP members to detect and prevent organized crime, ensure Canada's security interests, and protect Canada's economic integrity, while also providing for the safety of RCMP officers who are entrusted with the security of Canadians.
The RCMP uses the services of PSPC and Shared Services Canada for procurement requirements that exceed the contracting authority of the RCMP and for specialized requirements. The RCMP also procures goods, services, and constructions under its own delegated authorities through open, fair, and transparent processes to ensure best value for Canadians while meeting the RCMP's operational priorities.
In order to meet these and other operational priorities, the RCMP requires a wide range of goods and services. The bulk of these items are procured through open and competitive processes. As reported against the 2015–16 management accountability framework, the RCMP used competitive processes for 84% of contracts valued at over $25,000.
For calendar year 2014, the RCMP had more than 7,000 contracts awarded, for a total value of $395 million. As indicated by my colleague from PSPC, the number of NSEs invoked by PSPC for the RCMP is very low in each fiscal year. I believe it was 16%. In addition, the RCMP invokes the NSE for some of the procurements that it carries out under its own authorities. However, the use is very limited.
Even though the use is quite limited, the RCMP has a robust framework in place for the use of NSE, including an internal guideline for national security exceptions. All requests to PSPC to apply the NSE must first be approved at the deputy commissioner level at the RCMP, and they are reviewed by the corporate procurement branch that reports to me. In addition, for contracts within the RCMP's own delegated authority, the requests have to be approved by the chief financial officer, me. Invoking the NSE does not by itself allow the RCMP to sole-source procurement.
The RCMP does rely on the national security exception from the application of trade agreements, generally for two main reasons. The first is when the requirement cannot be published on the public-facing government electronic tendering systems because revealing technical requirements or specifications would compromise the operational requirements of the equipment being procured. Furthermore, depending on the purchase, disclosing the specifications of the equipment could have serious consequences on the safety of our members.
The second is when the minimum publication timeline under Canada's trade agreements cannot be met due to the urgent nature of the requirement. For example, solicitations subject to the North American Free Trade Agreement must be published for a minimum of 40 calendar days. Due to the operational nature of the RCMP, it is not always possible to plan procurement requirements in sufficient time to meet these posting requirements. As an example, the national security exception was invoked in advance of the North American leaders' summit in 2016. The rationale for using the exception was in part to protect the details of the operations to ensure the security of leaders, but also because of the short timelines that were available to procure the equipment ahead of the summit.
The national security exception is a key tool that enables the RCMP to meet its operational requirements for the protection of Canada's national security.
Mr. Chair and honourable members of the committee, I thank you for inviting the RCMP here today, and I would be pleased to answer any of your questions.