Evidence of meeting #32 for Government Operations and Estimates in the 43rd Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was cisco.
A recording is available from Parliament.
4:35 p.m.
Liberal
Steven MacKinnon Liberal Gatineau, QC
Could you talk about the Canadian Digital Service, or CDS, and what this small agency contributes to Treasury Board?
What is the CDS working on? What will the funds allocated to it be used for?
4:35 p.m.
Liberal
Joyce Murray Liberal Vancouver Quadra, BC
Thank you for that question.
We received more funding for our Canadian Digital Service last fall.
What the CDS has been doing is creating applications, quite quickly, working in the open, that can help provide services and a better service experience to Canadians. An example of this is that, at the height of the pandemic, when our government was rolling out multiple benefits and programs very quickly, the Canadian Digital Service created a benefit-finder tool. A person could go to one place and put in some anonymized information and then have, on the spot, a complete list of services they might be qualified for.
4:35 p.m.
Conservative
The Chair Conservative Robert Gordon Kitchen
Thank you, Minister.
Before we go to our next questions, I have a reminder. It has been brought to my attention that somebody has taken a picture of our screenshot and shared it. I indicated right at the beginning and I remind you once again that taking screenshots or photos of your screen is not permitted. I would ask that this be respected throughout all of our meetings.
Thank you.
That being said, I will now go to Ms. Vignola for six minutes.
4:35 p.m.
Bloc
Julie Vignola Bloc Beauport—Limoilou, QC
Thank you very much, Mr. Chair.
Good afternoon, Ms. Murray. Thank you for being with us today.
Shared Services Canada has an enormous job ahead of it to modernize the network. It has to think in terms of not only current needs, but also needs over the next ten years, and this calls for taking a very broad, very innovative and very creative view. The 2018 budget allocated $340 million per year to update information technologies, or IT. The 2021 budget adds $100 million to that amount, about $200 million of which is reserved for updating and modernizing the network. Of that $200 million, approximately $160 million has been awarded, untendered, to Cisco or one of its resellers, which ultimately amounts to the same thing.
Why has Cisco received favoured treatment, almost always by a non-competitive process?
4:35 p.m.
Liberal
Joyce Murray Liberal Vancouver Quadra, BC
Thank you for that question, Madame Vignola.
As I was mentioning earlier to MP Harder, we endeavour to have open and competitive procurement wherever possible, and we have very strong standards in that regard. There are the unique times when the equipment we are updating relies on some fundamental equipment from a sole provider, and in that case we will do a sole-source contract.
I'm happy to have Deputy Glover talk more about the specific situation you're asking about.
4:35 p.m.
President, Shared Services Canada
Thank you, Minister.
I would just like to reiterate for all committee members that even when a procurement is targeted to Cisco— that is, the requirements necessitate that it must be Cisco equipment—there is a competitive process wherein a number of vendors are asked to compete for the supply of that gear. That ensures that the government obtains the best possible price when it is targeted.
A number of people implied that it is not competitive. I understand that and wish to clarify that even when it is targeted to Cisco, there is still a competitive process to ensure the government receives the best price.
4:40 p.m.
Bloc
Julie Vignola Bloc Beauport—Limoilou, QC
Ultimately, whether it is Cisco or one of its resellers, it is Cisco equipment everywhere in the network and it is Cisco that gets the money.
The impression I have is that there is an attempt to portray this as a competitive process when, basically, there is no such process. It is the same equipment; it goes through an intermediary, but ultimately the same equipment is purchased.
I wonder whether there is nothing else compatible, that would mean that Canadians' and Quebeckers' money would be put to better use.
As a last point, I have received information saying that Cisco was trying, one way or another, to twist the situation a bit in order to get $100 million in contracts between now and the end of June, to make sure there would be no break in the supply chain. For most companies, June is the end of the fiscal year.
Is it true that Cisco is currently trying to pressure the Director General at Shared Services Canada and the Deputy Minister, Networks, Security and Digital Services, for them to expedite the purchasing process? Cisco hopes to sign an untendered 100 million contract by the end of June, to make sure that it has a completed procurement and achieves its financial objectives.
4:40 p.m.
Liberal
Joyce Murray Liberal Vancouver Quadra, BC
I can't speak to the objectives and timelines of the vendor community companies. What I can say is that Shared Services Canada is subject to very robust internal governance to make sure we have fair, open and transparent procurement processes. In fact, there has been an increase in network procurement awarded to other equipment manufacturers, such as Arista and Juniper, in the past two years.
4:40 p.m.
Bloc
Julie Vignola Bloc Beauport—Limoilou, QC
How much has Juniper received, as compared to Cisco or its resellers?
4:40 p.m.
Liberal
4:40 p.m.
President, Shared Services Canada
Thank you. I'm happy to facilitate an addition to the minister's answer.
There are a number of components within the network space. I apologize in advance if this is a bit of a long answer.
If you go back three years and look at how much we have increased to non-Cisco OEM providers, we went from literally nothing because most things were under a national security exemption. I lifted that. We had an increase of about $10 million in the last year. That's more than doubled in the last two years to over $22 million. We have seen a steady increase in the amount that has moved.
In some specific areas, it has been 100%. For example, in the firewall space where we relied solely on Cisco, that is now predominantly Fortinet. There are other vendors that we are slowly moving through that.
In the load balancer place, it was—
4:40 p.m.
Conservative
The Chair Conservative Robert Gordon Kitchen
Thank you, Mr. Glover.
Mr. Glover, I apologize for interrupting, but we do have to be cognizant of the time. If you could provide the further information in writing to the committee, it would be greatly appreciated.
We'll now go to Mr. Green for six minutes.
4:40 p.m.
NDP
Matthew Green NDP Hamilton Centre, ON
Thank you, Mr. Chair.
That actually prompted me.... There were some requests the last time Mr. Glover was here to submit some answers, and I can't recall if I received them or not. Through you, just to open up, has Mr. Glover been able to respond to all the questions of this committee from the previous one?
4:40 p.m.
A voice
Yes.
4:40 p.m.
NDP
Matthew Green NDP Hamilton Centre, ON
Okay, that looks good.
Through you, Mr. Chair, to the minister, welcome back.
How many sole-source contracts has network, security and digital services awarded in the past two years?
4:45 p.m.
Liberal
Joyce Murray Liberal Vancouver Quadra, BC
First, let me reinforce that we are committed to open, fair and transparent procurement. I will ask Deputy Glover to answer the numerical question about sole-source contracts.
4:45 p.m.
President, Shared Services Canada
Thank you.
The short answer this time is that 98% of our procurements were competitive in the network space, and 2% were non-competitive. The dollar value of that 2% was $4.8 million.
4:45 p.m.
President, Shared Services Canada
I do not have the breakdown for the non-competitive at that level at my fingertips.
4:45 p.m.
NDP
Matthew Green NDP Hamilton Centre, ON
Just to be clear, so that we're on the record, is your interpretation of non-competitive the same as the generally accepted definition of a sole-source contract, or is there a semantic gap in what I'm asking and how you're answering?
4:45 p.m.
President, Shared Services Canada
If I can follow up, I know the question is directed through the minister to me. There are no semantics here. We follow Government of Canada definitions around competitive and non-competitive, sole-source, etc., so I will be using the standard government interpretation consistent with policy.
4:45 p.m.
NDP
Matthew Green NDP Hamilton Centre, ON
Would that be in terms of 2% of the contracts that went out or in the total spending? How does that compare with total spending from a budgetary perspective?
4:45 p.m.
President, Shared Services Canada
That would be on the spend. We netted it up around the total dollar value, and 98% of the total spend was procured through competitive means, while 2% or $4.8 million of the total was through non-competitive means. Again, I know this is controversial for the committee, but even when targeted, if it is competed amongst a number of vendors, that is considered competitive as per government policy.